US in FATCA talks with 80 jurisdictions

Totally scary , in my opinion this is more power to the USA to collect information on US taxpayers & non US taxpayer. Even the government don’t know how to enforce / police this .

US in FATCA talks with 80 jurisdictions.

In recent weeks, we have learned that FATCA is being delayed yet again, marking F-Day as July 1, 2014. Now it has become clear that the reason behind the extension is due to an ‘overwhelming interest’ in FATCA from several jurisdictions worldwide.

Since it is complex, even illegal in some places, for Foreign Financial Institutions (FFIs) to report directly to the Internal Revenue Service (IRS), the US has developed intergovernmental agreements (IGAs). That way, as required to comply with FATCA, the FFIs give all the tax dirt to their own governments, which in turn swap tax data with the IRS.

Tax experts commented that this may be the most important recent development, as the US has since successfully signed nine IGAs and is currently engaged in discussions with over 80 other jurisdictions.

Thus far, the signed IGAs are: UK, France, Germany, Italy, Spain, Japan, Switzerland, Canada, Denmark, Finland, Guernsey, Ireland, Isle of Man, Jersey, Mexico, The Netherlands and Norway.

Meanwhile, the FATCA registration website should be open by August 19, 2013, allowing financial institutions time to begin testing the process and entering information. Some said that, ‘For many in banking and financial services, the world will never be the same’. It will also never be the same again for US expats worldwide.

Enacted in 2010, FATCA targets US taxpayers using foreign accounts and requires foreign institutions to tell the IRS about accounts held by US taxpayers, or foreign entities in which US taxpayers hold substantial ownership. To avoid a withholding tax, a participating institution must enter into an agreement with the IRS to (i) identify US accounts; (ii) report personal information regarding US clients to the IRS; and (iii) withhold a 30% tax on certain payments to non-participating FFIs and account holders who are unwilling to provide the required information.

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